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Mohinder Singh Jubbal Vs. Grindlays Bank Ltd. and ors. - Court Judgment

LegalCrystal Citation
SubjectCommercial
CourtPunjab and Haryana High Court
Decided On
Case NumberCivil Revn. No. 2756 of 1981 and Civil Misc. Appl. No. 4332-CII of 1981
Judge
Reported inAIR1982P& H295
ActsLimitation Act, 1963 - Schedule - Articles 1 and 12; Code of Civil Procedure (CPC), 1908 - Sections 10 - Order 2, Rule 2 and 2(3)
AppellantMohinder Singh Jubbal
RespondentGrindlays Bank Ltd. and ors.
Cases ReferredSmt. Naurati v. Mehma Singh
Excerpt:
.....unless the decision of the suit operates as res judicata in the other suit, it cannot be said that the matter in issue is directly and substantially the same in both the suits, that is to say, the decision in one suit must fail the other suit before it can be said that the matter in issue in both suits is directly and substantially the same......of goods by hypothecation, the pledge of the machinery and the alleged mortgage of the property in suit, but subsequently, the plaintiff gave up the relief for the sale of the mortgaged property in that suit and as such, the suit out of which this revision petition has arisen, was barred under o. 2, r. 2 of the civil p. c. (hereinafter called the code). the other pleas taken in the written statement are not relevant at this stage. on the pleadings of the parties, the trial court framed the following two preliminary issues:1. whether the suit is barred under the provisions of o. 2, r. 2 of civil p. c.? 2. whether the suit is liable to be stayed for the reasons stated in paragraph no.1 of the written statement? the defendants placed on the file, the copies of the documents, exhibits d. 1.....
Judgment:
ORDER

1. This revision petition is directed against the order of the trial Court dated Aug. 12, 1981, whereby the two preliminary issues, arising in the suit for the recovery of Rs.16,74,596.98, out of which the present revision petition has arisen, have been decided against the defendant-petitioner.

2. M/s. Grindlays Bank Limited, the plaintiff-respondent, filed a suit on Sept. 25, 1978, on the allegations that defendant-respondent No. 2 was a partnership firm while defendants-respondents Nos. 1 and 3 were its partners and had been carrying on the business in their factory at Faridabad and that defendants Nos. 1 and 3 were also the guarantors for the re-payment of the amount due to the plaintiff from defendant-respondents No. 2. It was also alleged that the defendants had been taking loans from the plaintiff from time to time and, thus the total amount of Rs.11,57,684.17 was due to the plaintiff from the defendants. It was also alleged that a sum of Rupees 5,16,912.82 was due to the plaintiff as interest and that the total amount due to it, thus, came to Rs.16,74,596.98. Since the petitioner created mortgage over his property by depositing the title deeds of his property with it, it was prayed that on that oasis, a preliminary mortgage decree for Rs.16,74,596.98, be passed in its favour. It was also pleaded that a final mortgage decree for the sale of the mortgaged property be passed in the event of the defendants failing to satisfy the preliminary decree and that the sale proceeds thereof be paid to it towards the payment of the decretal amount. In the written statement filed on Nov. 29, 1978, it was inter alia pleaded that the suit was liable to be stayed as the matter in issue in the suit was also directly and substantially in issue in a previously instituted suit between the same parties, (suit No. 107 of 1975), pending in the High Court at Delhi. It was further pleaded that in the previous suit, the plaintiff had originally prayed for the recovery of Rs.11,57,684.17, on the basis of the pledge of goods by hypothecation, the pledge of the machinery and the alleged mortgage of the property in suit, but subsequently, the plaintiff gave up the relief for the sale of the mortgaged property in that suit and as such, the suit out of which this revision petition has arisen, was barred under O. 2, R. 2 of the Civil P. C. (hereinafter called the Code). The other pleas taken in the written statement are not relevant at this stage. On the pleadings of the parties, the trial Court framed the following two preliminary issues:

1. Whether the suit is barred under the provisions of O. 2, R. 2 of Civil P. C.?

2. Whether the suit is liable to be stayed for the reasons stated in paragraph No.1 of the written statement?

The defendants placed on the file, the copies of the documents, Exhibits D. 1 to D. 4. No other evidence was led by either side. Under issue No. 1, the learned trial Court held that the suit was not barred by the provisions of O. II, R. 2 of the Code. The reason given for the same was that since the mortgaged property was situated in Faridabad, the subsequent suit, for the recovery of the amount, on the basis of the mortgage of the property, could only be filed at Faridabad and not at Delhi. Under issue No. 2, it was held that the subsequent suit was not liable to be stayed under the provisions of S. 10 of the Code. Dissatisfied with the same, the defendant-petitioner has come up in revision to this court.

3. The learned counsel for the petitioner, vehemently contended that both the preliminary issues, referred to above, have been wrongly decided by the trial Court. The subsequent suit filed by the plaintiff at Faridabad, was barred under O. II, R. 2 of the Code and, in any case, it was liable to be stayed under S. 10 of the Code. The main thrust of the argument of the learned counsel is that it was the same loan for which the previous suit had been filed in the Delhi High Court and for the recovery of which, the subsequent suit, has been filed at Faridabad. Thus, according to the learned counsel, the cause of action is the same in both the suits and, therefore, in view of the provisions of O. II, R. 2(3) of the Code, the plaintiff was debarred from suing for any relief which he so omitted in the previous suit, filed in the Delhi High Court. The argument proceeds that even though the relief claimed may be separate in both the suits, yet the cause of action for claiming the relief is the same in both the suits and, therefore, the case was fully covered by the provisions of O. II, R. 2(3) of the Code. In support of his contention, that the subsequent suit was barred under O. II, R. 2(3) of the Code, the learned counsel placed reliance on Mohammad Khalil Khan v. Mahbub Ali Mian, AIR 1949 PC 78; Abnashi Singh v. Smt. Lajwant Kaur, (1976) 78 Punj LR 828 : (AIR 1977 Punj 1); Haryana Co-operative Sugar Mills Ltd., Rohtak v. Joint Hindu Family Firm styled as M/s. Gupta Ram Supply Company, (1976) 78 Pun LR 313 : (AIR 1976 Punj 117); . AIR 1962 Guj 296; Mandal & Co. v. Fazul Ellahie, (1914) ILR 41 Cal 825: (AIR 1915 Cal 126) and S. A. Ananatanarayana Iyer v. Savithri Ammal, (1913) ILR 36 Mad 151. On the question of the stay of the subsequent suit under Section 10 of the Code, it was contended that any decision, given in the previously instituted suit in the Delhi High Court, would not operate as res judicata in the subsequently instituted suit at Faridabad, and the relief claimed in both the suits being separate and distinct, the provisions of S. 10 of the Code, are not attracted. In support of this contention, reliance, was placed on Smt. Naurati v. Mehma Singh, AIR 1972 Punj and Har 421;Sankhla Industries v. Hiralal Pukhraj, AIR 1973Raj 306 and Shaw Wallace & co. Ltd. v. Bholanath Madanlal Sherwala, AIR 1975 Cal 411.

4. I have heard the learned counsel for the parties at a great length and have also gone through the judgment cited at the bar.

5. The main question for determination in this petition is whether the relief claimed in the suit filed, on the basis of the mortgage created by the deposit of the title deeds of the immoveable property, at Faridabad, provides a separate and distinct cause of action, or the cause of action is the same in both the suits, i.e., to recover the loan advanced to the defendants, as contended by the learned counsel for the petitioner. Order II, R. 2 of the Code reads,--

'2. Suit to include the whole claim.-

(1) Every suit shall include the whole of the claim which the plaintiff is entitled to make in respect of the cause of action; but a plaintiff may relinquish any portion of his claim in order to bring the suit within the jurisdiction of any Court.

(2) Relinquishment of part of claim.--Where a plaintiff omits to sue in respect of, or intentionally relinquishes, any portion of his claim, he shall not afterwards sue in respect of the portion so omitted or relinquished.

(3) Omission to sue for one of several reliefs.--A person entitled to more than one relief in respect of the same cause of action may sue for all or any of the reliefs; but if he omits, except with the leave of the Court, to sue for all such reliefs, he shall not afterwards sue for any reliefs so omitted.

Explanation.--For the purpose of this rule an obligation and a collateral security for its performance and successive claims arising under the same obligation shall be deemed respectively to constitute but one cause of action.'

6. It is the common case of the parties that it is sub-rule (3) of R. 2 of O. II of the Code, which is relevant for the determination of the present revision petition. In order to attract the said provisions, a person must be entitled to more than one relief in respect of the same cause of action. If on the same cause of action, the same relief could not be had in the suit instituted earlier, then it could not be disputed that the bar under O. II, R. 2(3) of the Code, is not attracted. Reference in this respect by both the parties, has been made to Mohammad Khalil Khan's case (AIR 1949 PC 78) (supra). In para 61 of the judgment in the said case, certain principles have been laid down by the Privy Council in order to attract the applicability of the provisions of O. II R. 2 of the Code, in a given case, and one of the principles laid down is whether the claim in the new suit is, in fact, founded upon a cause of action distinct from the one which was the foundation of the former suit. The cause of action means every fact which will be necessary for the plaintiff to prove, if traversed, in order to support his right to the judgment. If the evidence to support the two claims is different, then the causes of action are also different. The causes of action in the two suits may be considered to be the same if in substance they are identical. The cause of action has no relation whatsoever to the defence that may be set up by the defendant, nor does it depend upon the character of the relief prayed for by the plaintiff. It refers to the media upon which the plaintiff asks the Court to arrive at a conclusion in his favour. Thus, it is clear that the 'cause of action' refers to the media upon which the plaintiff asks the Court to arrive at a conclusion in his favour. It is the common case of the parties that the suit, in the Delhi High Court, had been filed for the recovery of the loan, on the basis of the goods pledged by hypothecation with the plaintiff Bank whereas the subsequent suit, under O. XXXIV of the Code, has been filed for the recovery of the amount of the loan advanced, by sale or otherwise of the property mortgaged in its favour. It may be that the loan is the same which was advanced by it to the defendants, but admittedly, two separate distinct securities were furnished by them for the recovery of the loan. One of the securities was by way of pledge by hypothecation of the goods to the plaintiff whereas the other security furnished was by deposit of title deeds of the immoveable property, thus, creating a charge thereon. Even if the loan is the one and same as stated earlier, but there are two distinct and separate securities furnished by the defendant for the same. The plaintiff has, under these circumstances, two different causes of action to maintain both the suits. Reference in this respect may be made to Kishan Narain's case (AIR 1922 PC 412) (supra) wherein it has been held that if the mortgage provided, as mortgagee always to in England, for an independent obligation to pay the principal and the interest then a suit brought to obtain a personal judgment in respect of the interest alone, would not prevent a subsequent claim for payment of the principal. In such a case the cause of action would be distinct. The matter is, however, different if the non-payment of the interest causes the principal money to become due, as in that case the cause of action--the non-payment of the interest--gives rise, to two forms of relief which the Code provides shall not be split. In Sidramappa's case (AIR 1970 SC 1059) (supra), the provisions of O. II, R. 2 of the Code, were again considered by the Supreme Court and it was held therein that the requirement of O. II. R. 2 of the Code is that every suit should include the whole of the claim which the plaintiff is entitled to make in respect of a cause of action. 'Cause of action', means the 'cause of action for which the suit was brought'. Cause of action is a cause of action which gives occasion for and forms the foundation of the suit. If that cause of action enables a person to ask for a larger and wider relief than that to which he limits his claim, he cannot afterwards seek to recover the balance by independent proceedings. Where the cause of action on the basis of which the previous suit was brought does not form the foundation of the subsequent suit and in the earlier suit the plaintiff could not have claimed the relief which he sought in the subsequent suit, the plaintiff's subsequent suit is not barred by O. II, Rs. 2 of the Code, Reference in this behalf has also been made to Kishan Narain's case (supra).

7. Applying the abovesaid principles to the facts of the present case; it is quite evident that the cause of action, on the basis of which the previous suit has been filed in the Delhi High Court, i.e., the suit for the recovery of the loan on the basis of the hypothecation of the goods belonging to the defendants does not form the foundation of the subsequent suit, filed at Faridabad. It is not disputed that the Delhi High Court could not pass a decree in favour of the plaintiff in the earlier suit, on the basis of the mortgaged property, because the same in situated outside its territorial jurisdiction. As a matter of fact, it was on that account that an objection was taken by the defendants in that suit, on which the plaintiff amended his plaint and deleted the said relief from the original plaint. In coming to the conclusion that the provisions of O. II, R. 2 of the Code are not attracted to the present case, reliance has been placed on Ma Kyi's case (AIR 1935 Rang 365) (supra), in this Court, and it was relied upon by the trial Court as well. However, the learned counsel for the petitioner, distinguished this case on the ground that in the said case, each document constituted a distinct cause of action, because the loan in that case, was split up and for separate amount, two separate and distinct securities were furnished. It may be so, but as observed therein, though the original obligation is single and entire, but when one party has chosen to execute separate documents for portions of the obligation and the other party has chosen to accept the said documents, each document constitutes a distinct cause of action. Similarly, in the present case, though the original obligation is the same, that is, the taking of the loan from the plaintiff Bank, but for the same loan, the defendants have furnished two distinct and separate securities and the plaintiff has accepted the same. Thus, each document constitutes a distinct cause of action.

8. It appears that in the trial Court, a reference was made to O. XXXIV, R. 14 of the Code, but the learned counsel for the plaintiff-respondent, fairly conceded that the provisions of R. 14 of O. XXXIV of the Code, were not applicable to the facts of the present case. The main burden of his argument is, that the suit at Faridabad has been filed on the basis of the mortgage whereas the suit in the Delhi High Court has been instituted on the basis of the goods pledged with the plaintiff Bank. Once it is so held, then, all the rulings relied upon by the learned counsel for the petitioner, are distinguishable.

9. In Manubothula Rama Rao's case (AIR 1931 Mad 705) (supra), strongly relied upon by the learned counsel for the petitioner, the plaintiff in a suit for maintenance against her husband, did not ask for the relief that any amount that would be decreed to her should be made a charge on the husband's property for the reason that the husband has no property in the jurisdiction of the Court where the suit is instituted. A second suit by her in the Court within whose jurisdiction the property of the husband was situated was held to be incompetent, as she must be held to have relinquished the particular relief which might have been open to her of getting a charge on the husband's property situated in different jurisdiction. Thus, the cause of action in both the suits, in that case, was the same and, therefore, it was rightly held in that case that the provisions of O. II, R. 2 of the Code, were attracted. As observed earlier, in the present case, there is no such situation. Thus, taking into consideration all the facts and circumstances of the present case, I am of the considered opinion that it has been rightly held by the trial Court, under preliminary issue No. 1, that the subsequent suit instituted at Faridabad, was not barred under the provisions of O. II, R. 2 of the Code.

10. More or less, the answer to the above issue decides the fate of the other preliminary issue as well. Once it is held that the cause of action in both the suits is separate and distinct and the decision in the earlier suit filed in the Delhi High Court, would not operate as res judicata in the subsequent suit filed in the Court at Faridabad, then the provisions of Section 10 of the Code, would not be attracted. The object of Section 10 of the Code, as observed in Smt. Naurati v. Mehma Singh, AIR 1972 Punj and Har 421, is to prevent Courts of concurrent jurisdiction from simultaneously entertaining and adjudicating upon two parallel litigations in respect of the same cause of action, the same subject-matter and the same relief and to obviate the possibility of two contradictory verdicts by one and the same Court in respect of the same relief. It has also been held therein that Section 10 cannot apply when the final decision in the previous suit would not operate as res judicata in the subsequent suit. It is true that in Section 10, the words, 'cause of action' have not been used. What it contemplated is that no Court shall proceed with the trial of a suit in which the matter in issue is also directly and substantially in issue in a previously instituted suit between the same parties. Thus, what is to be seen is whether the matter in issue in both the suits is directly and substantially the same? Once it is held that the relief as well as the cause of action is different in both the suits, then, it is obvious, that the matter in issue, is also not the same either directly or substantially, in both the suits. In the previous suit, the controversy between the parties is : whether the plaintiff Band advanced any loan to the defendants and for that purpose certain goods were pledged with it by the defendants by way of security, to recover the said loan, whereas in the subsequent suit, the main question is : whether the plaintiff Bank is entitled to recover the loan by way of sale of the mortgaged property, or not? In other words; whether the defendants mortgaged the property with the plaintiff Bank by way of security, for the realisation of the loan advanced to them or not?

11. It has been observed in Bholanath Madanlal Sherawala's case (AIR 1975 Cal 411) (supra), that the expression 'the matter in issue' in Section 10 has reference to the entire subject-matter in controversy between the parties and a mere identity of some of the issues in both the suits is not sufficient to attract Section 10 unless the decision of the suit operates as res judicata in the other suit, it cannot be said that the matter in issue is directly and substantially the same in both the suits, that is to say, the decision in one suit must fail the other suit before it can be said that the matter in issue in both suits is directly and substantially the same. Even if the Delhi High Court dismisses the plaintiff's suit on the ground that no goods were pledged by way of security with the plaintiff for the loan advanced by it to the defendants, the plaintiff would still be entitled to prove independently in the subsequent suit filed at Faridabad, that the property was mortgaged with it by the defendants to enable it to recover the said loan. In this view of the matter, the preliminary issue No. 2, has also been correctly decided by the trial Court holding that the subsequently instituted suit at Faridabad was not liable to be stayed under the provisions of Section 10 of the Code.

12. For the reasons recorded above, this revision petition fails and is dismissed with costs. In view of the decision in the main revision petition, Civil Miscellaneous Application No. 4332-CII of 1981 also stands dismissed.

13. Petition dismissed.


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